TCL Multimedia Technology Holdings, one of the world's top three television makers by unit sales, said its first-half loss narrowed by 86 per cent thanks to the closure of its loss-making operation in Europe.

The unit of TCL Group, the mainland's largest consumer electronics maker, posted a loss of HK$220 million for the first six months of the year, from the HK$1.6 billion loss a year earlier. Turnover was HK$9.51 billion, down 34 per cent.

"We see a narrowing loss in the first half because losses caused by our European unit were not included after its closure [earlier this year]," said Simon Chan, corporate controller of TCL-Thomson Electronic (TTE).

TTE Europe, the European business TCL Multimedia inherited from a venture with Thomson Group, has burdened TCL as consumers shift to flat-panel televisions from cathode ray tube (CRT) models, the major product of TTE Europe.

The company sold seven million televisions globally in the first half, 35 per cent less than a year earlier. Total television sales dropped 38 per cent to HK$8.2 billion from HK$13.2 billion a year earlier.

The mainland market remains the largest source of revenue for TCL Multimedia, contributing 57 per cent of its revenue. Sales in Europe and North America dropped 68 per cent to HK$1.93 billion.

"The drop in TV sales is mainly due to the continuous shrinking of CRT markets," said Mr Chan.

Meanwhile, TCL Communication Technology Holdings, the mobile-phone unit of TCL Group, said it swung to a profit this year despite shrinking sales. First-half earnings reached HK$2 million, compared to a loss of HK$71 million a year earlier, thanks to cost savings after the reshuffle of its logistics arrangements.

Revenue was HK$2.1 billion, 17 per cent lower than a year earlier, as total handset sales dropped 23 per cent to 4.2 million units. Overseas sales accounted for 89 per cent of the total sales volume. The firm expects to see handset sales on the mainland grow to as much as 20 per cent of sales in the near future.